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CPC Vice Chair Rep. Keith Ellison: Three myths about the minimum wage

Maggie McCaffrey works as a barista in Minneapolis and rarely clears a living hourly wage, even with tips. She is having trouble paying down her student loans, and asks: “In what other industry are customers expected to pay the worker’s wage?”

So Maggie joined the Fight for $15 — the movement that has taken hold across the country. Faced with more than three decades of stagnating wages, workers have raised their voices with the simple request that their work should pay enough for them to have a decent living. Minneapolis leaders have heard their call and are poised to raise the minimum wage. But the debate recently has centered around how to count tips (“City leaders: Will you leave a tip credit?”, June 11).

As the City Council vote approaches, I’d like to address a few common myths on the minimum wage:

The first myth is that we need a lower wage for tipped workers.

Tipped workers are some of the poorest in the country, being three times more likely to live below the poverty line. For female servers, who make up two-thirds of the tipped workers, it’s even more difficult to get by since they are paid 70 percent of what their male counterparts make. Tipped workers are also heavily people of color, deepening the existing racial wage gaps in our community. And no worker should have to audition on a regular basis simply to earn the minimum wage.

This is why I introduced the Raise the Wage Act last month to raise the federal minimum wage to $15 an hour from the current $7.25 per hour and to eliminate the unfair lower federal minimum wage for tipped employees — currently a shameful $2.13 per hour.

With the help of workers and organizers, the Raise the Wage Act has more than 150 cosponsors in the House and 30 Senate cosponsors (including both Minnesota senators).

Unlike the federal government, Minnesota has been for more than 30 years one of the few states that does not have a separate, subminimum wage for tipped workers. That is something I am proud of and I know many other Minnesotans are, too.

The second myth is that minimum wage and tipped jobs are entry-level jobs for teenagers living at home. In fact, the average age of a minimum wage worker is 35, and they often earn half of their families’ total income.

The percentage of tipped workers in Minneapolis who earn more than $15 an hour is tiny. According to the most recent Bureau of Labor Statistics data, the median wage, including tips, for restaurant servers in the Minneapolis metro area was $9.68 per hour.

This is not a livable wage. A recent study by the National Low Income Housing Coalition revealed that workers in Minnesota would have to earn $18.60 an hour or work 78 hours a week at the minimum wage to afford a two-bedroom rental.

The third myth is that raising one fair wage to $15 over time is bad for business. Raising the minimum wage for workers, including tipped workers, is good for the economy. I understand the anxiety of small businesses. I was a small-business owner myself once. But research has shown that locations with higher minimum wages don’t see more business failures — in fact, the businesses actually grow faster.

When workers have more money in their pockets, they’re more likely to spend it at local businesses and that means more restaurant customers. Nineteen states increased the minimum wage in 2016, and cities like Los Angeles, San Francisco and Portland are all phasing their minimum wages up to $15 an hour without the tip penalty.

In Minneapolis, we’ve seen workers organize around a $15 minimum wage, and leaders like Mayor Betsy Hodges and the Minneapolis City Council have helped bring this close to becoming a reality. The current proposal has a phase-in period that takes into account the concerns of smaller, local businesses to help them adjust.

At the end of the day, raising wages is about basic human dignity. Nobody working full time should live in poverty, struggling to put food on the table or worrying about not being able to pay the light bill.

Our country is ready, and Minneapolis is ready to be a leader on this crucial issue facing people like Maggie who deserve so much more. As we take this important step addressing the growing divide in our country, let’s not leave anyone behind. All workers, whether they receive tips or not, deserve one fair wage of $15 an hour.